Ouro faces pressure from the US dollar ahead of the US employment report

Precious metal declines this Friday as the US dollar benefits from gains accumulated over the past two weeks. The commodity’s trajectory will be determined by key US labor market data released today.

Technical Dynamics of XAU/USD: Where Are the Supports

The technical analysis of the XAU/USD pair reveals a mixed scenario. The price remains above the 200-period exponential moving average, currently at US$ 4,322.58, which maintains the medium-term upward trend. The MACD is below the signal line and zero but is in recovery, suggesting weakening selling pressure.

The Relative Strength Index (RSI) is at 56, above the neutral zone of 50, indicating that momentum is regaining strength without signaling overbought conditions. Confirmation of this trend would depend on maintaining above US$ 4,322.58, while a break below could open the door to a deeper retracement.

Optimists of the yellow metal await a move above US$ 4,500 to resume significant advances. Until then, the market oscillates between technical support and the pressure of the strengthened US dollar.

What Is the Value of the US Dollar Today and What Drives It

The US dollar reached nearly a one-month high during Thursday’s Asian session, reflecting the gains accumulated over the last 14 days. This rise directly impacts dollar-priced commodities, including gold.

However, dovish prospects from the Federal Reserve limit further gains for the currency. Scott Bessent, US Treasury Secretary, stated on Thursday that interest rate cuts are an essential component for more robust economic growth, signaling that the Fed is unlikely to delay new cuts.

Traders are pricing in a concrete possibility of rate reduction in March and additional cuts by the end of the year. This scenario would support gold, moderating the US dollar’s gains in the short term.

NFP Report: The Catalyst That Could Rewrite the Script

The US non-farm employment data (NFP) released today will set the tone for upcoming movements. The US economy is expected to have created 60,000 new jobs in December, lower than the 64,000 in the previous month. Simultaneously, the unemployment rate should decline from 4.6% to 4.5%.

A weaker-than-expected reading would strengthen arguments for rate cuts and support gold. Conversely, a strong result would keep pressure on the precious metal and consolidate gains in the US dollar. The market remains alert to any surprises in these figures.

Geopolitical Uncertainties Provide a Shield for Gold

Rising international tensions act as a support factor for the XAU/USD pair. President Donald Trump stated in an interview with the New York Times on Wednesday that he expects the US administration to manage Venezuela and extract oil from local reserves in the coming years. This statement intensifies regional instability.

At the same time, China has raised the tone in its dispute with Japan, restricting exports of rare earths and rare earth magnets following statements by the Japanese Prime Minister regarding Taiwan. This trade escalation amplifies market uncertainties.

In Europe, German Chancellor Friedrich Merz indicated that the conclusion of the war in Ukraine is distant, considering it dangerous to send European troops. The prolongation of the conflict sustains demand for safe-haven assets like gold.

US Dollar Performance Against Major Currencies

During the week in question, the US dollar showed broad gains. Its most significant performance was against the Swiss franc, with an increase of 0.92%. Against the euro, the movement was more modest at 0.60%. Against the Japanese yen, the rise reached 0.90%.

These variations reflect a broad strengthening of the US currency, driven by robust economic prospects in the US contrasted with the relative weakness of other developed economies. Maintaining this strength will largely depend on the employment data released this Friday.

Forward Outlook: Wait for Confirmation Before New Positions

The current environment calls for caution both for gold optimists and pessimists. The commodity is close to its all-time highs reached in December, creating an environment where further declines should wait for clearer signals of weakness.

Holding above US$ 4,322.58 would preserve an optimistic tone, while support in this region would prevent a deeper retracement. Prudent traders await the employment report and acceptance above US$ 4,500 before making significant new directional bets. The behavior of the US dollar remains a critical factor in this short-term game.